Zipcar: What to Expect from the Avis Acquisition

A couple of interesting points from the conference call where executives from Avis Budget Group discussed the $500 million acquisition of car-sharing service Zipcar:

- Weekends: Zipcar’s 760,000 users tend to hit the service hardest on weekends, and its cars can get pretty hard to find in peak times. That can be frustrating for users, but it also leads to lost revenues. It just so happens that traditional car rental companies have the opposite problem: lots of weekday rentals by business travelers, and quiet weekends when parking lots can fill up with unused cars.

So one item on the agenda for the newly-acquired Zipcar will be using Avis/Budget cars to meet excess Zipcar demand on weekends: “a win-win for everyone involved” said Avis chief Ronald L. Nelson.

- International: Having access to Avis/Budget infrastructure in international markets will help Zipcar expand in geographies that “would have been harder or uneconomic on its own,” Mr Nelson said. And the $50-70 million in synergies that Avis says it can produce from the deal are entirely based in North America, meaning anything that can be squeezed in Europe and Australia would be bonus money.